Published by Breitbart | May 18, 2021
Construction of new homes in the U.S. slowed by much more than expected in April as homebuilders held back on projects because prices of materials and labor have been rising rapidly.
Private homes were started at a seasonally adjusted, annualized rate of 1.569, a 9.5 percent decline from March, Commerce Department showed Tuesday. Economists had expected a rate of 1.705 million.
The decline was even sharper in the single‐family home market, where the housing shortage is most acutely felt. Single-family housing starts in April fell to a rate of 1,087,000, 13.4 percent below the March rate.
The annual declines are now not useful measures of the health of the market because they reflect a near shutdown of construction in the spring of 2020 due to pandemic lockdowns. Compared with last April, housing starts are up 69 percent.
Single‐family authorizations to building homes in April fell to a rate of 1,149,000, 3.8 percent below the revised March figure. That indicates that the shortage of housing could continue in the months ahead, a promising development for home-sellers hoping prices will continue to rise or remain high but bad news for those looking to buy a first home.
Prices of lumber have risen sharply in recent months, largely due to demand for housing and home improvement. In fact, current lumber prices are now cheaper than futures, a rare phenomenon called “backwardation.” Other materials, including copper, are also pricier and many builders have complained that they are having trouble finding workers.